GBPNZD has formed higher lows and lower highs to consolidate inside a symmetrical triangle on its hourly time frame, with price currently bouncing off support at the 2.2000 major psychological mark.

The pair could set its sights on the triangle top at 2.2100 from here or even attempt to break higher and go for a rally that’s the same height as the chart formation or around 400 pips. However, the 100 SMA is below the 200 SMA to suggest that the path of least resistance is to the downside or that support is more likely to break than to hold.

Stochastic already made it to the overbought zone to signal exhaustion among buyers, so turning lower would signal a return in selling pressure. A break below the triangle support could also lead to a drop that’s the same height as the formation.

RSI appears to be turning lower without reaching the overbought area, suggesting that sellers are eager to take over. The oscillator has plenty of ground to cover before reaching the oversold region as well, so price could keep following suit.

GBPNZD could take cues from overall market sentiment since there are no major reports lined up from the UK or New Zealand next. Over the weekend, New Zealand printed stronger than expected quarterly retail sales data, although the Kiwi’s reaction was muted since it is old data and the central bank has recently cut interest rates.

Although the RBNZ suggested that they are keeping the door open for more easing, their statement also pointed to a slower pace of rate cuts than in their past three decisions. Meanwhile, UK economic data has been mostly upbeat on the jobs and inflation front, dampening hopes of a BOE rate cut in their next monetary policy meeting.